Spartanburg Herald Journal: Tax relief was tax hike for most
Tax relief was tax hike for most
$1M Spartanburg homes see big property tax cut
By Robert W. Dalton
Published: Thursday, August 6, 2009 at 3:15 a.m.
Last Modified: Thursday, August 6, 2009 at 12:20 a.m.
The majority of Spartanburg County homeowners now pay more in property taxes than they did before the much-hyped tax relief the state Legislature approved in 2006.
As an added bonus, they also pay an extra penny on the state sales tax, part of the swap lawmakers worked out to remove school operating taxes from owner-occupied property.
Owners of $100,000 homes in the city of Spartanburg paid $889 in 2006, the year before Act 388 went into effect. That dropped to $863 in 2007, but climbed to $921 last year, according to figures from Spartanburg County Auditor Sharon West. West said she wouldn’t know until September what the taxes would look like this year.
Almost 39,600 Spartanburg County homes are valued at $100,000 or below, with about the same number worth more than $100,000.
For residents with a $1 million home — 35 houses in the county are valued at $1 million or more — the 2008 tax bill was $8,791, down from $14,990 the year before Act 388 took effect.
State Rep. Harold Mitchell said the figures prove what he was saying when the Legislature debated the tax swap — that the plan was designed to bail out the wealthy. Mitchell was one of 31 House members to vote against the swap.
“The numbers don’t lie,” said Mitchell, D-Spartanburg. “The owners of these 39,000 homes are working-class citizens of Spartanburg. “There’s already a financial crunch, and their taxes are increasing at a time like this.”
State Sen. Lee Bright said he’s opposed to property taxes, period. He said it was only fair to give high-end homes the same break as more modest residences.
“Higher wage earners pay a disproportionate amount of taxes now,” said Bright, R-Roebuck. “With the amount of taxes they pay now, to say any kind of tax reduction would bail out the wealthy is not accurate.”
Bright said the real issue is the state’s spending habits. He said if lawmakers control spending, the taxing issue will take care of itself.
“We continue to talk about tax policy, but the elephant in the room is our spending problem,” Bright said.
Owners of $200,000 homes in the city paid $2,455 in 2006 and $1,795 last year. Owners of $500,000 homes paid $7,156 in 2006 and $4,419 in 2008.
One reason for the disparity is that owners of homes valued up to $100,000 already were exempt from school operating taxes under a 1995 tax relief plan. But millage increases quickly erased the modest reductions they experienced under Act 388.
Act 388 prevents local governments, school districts and other taxing entities from increasing millage by more than a formula based on population growth plus inflation. But, West said, most entities are going up to the limit.
“If they miss it one year, they can’t go back and recoup it under Act 388,” West said.
Spartanburg County Administrator Glenn Breed said the county has increased its millage the full amount both years Act 388 has been in effect.
“If you don’t approve it one year, you lose it forever — or until the act is changed,” he said.
Breed said the ongoing budget crisis has compounded the problem. The state cut about $2.5 million in funding to the county this year.
“Where do you make that up?” Breed said. “It kind of forces the issue.”
Breed said taxpayers will be “stuck in this same scenario” until the Legislature amends Act 388 or approves another property tax reform package.
Bright said that’s not going to happen in the session that begins in January.
“I know there’s been a lot of talk about repealing Act 388, but that’s not going to happen,” he said. “There are a lot of issues that are going to come to the forefront, and that’s not going to be revisited.”